Monday, April 30, 2007

Turkey's financial markets tumbled amid political instability triggered by a court challenge to the presidential election process and a mass demonstration against the ruling party. Fears of military intervention, prompted by an army warning to the Islamist-rooted AK Party government that it would protect the secular state, added to the woes Monday.

The main share index fell as much as 8 percent, while bond yields rose a percentage point and the lira currency slid four percent. Markets had staged a partial recovery by the close of trade in what was the biggest sell-off in nearly a year.

Business Week breaks it down for you here:Turkish Turmoil Slams Markets.Their currency got hammered too. The Deputy Prime Minister attempted to reassure the jittery markets and tonight the Prime Minister, Tayyip Erdogan, will be conducting his regular weekly television address. It will be interesting to see what happens...Stay tuned.

Update: Turkish PM appeals for unity.Turkey's prime minister appealed for calm Monday after the stock market dropped amid a deepening conflict between his Islamic-oriented government and pro-secular forces backed by the military....Analysts said the markets will likely recover if the government defuses tension by agreeing to early parliamentary elections, a move that could appease opponents who hope to make electoral gains at the expense of the ruling party. But sustained political uncertainty would likely take a toll. In his speech, Erdogan made no direct reference to the stock market slide (!!!!!) or the challenges to his mandate, instead issuing a broadly worded appeal to Turks to safeguard the economic advances and social stability that they have gained after decades of uneven development and, at times, all-out political conflict. Reactions range from the hilarious to well, the downright criminal. First, the hilarious:

The head of Europe's top human rights organization expressed shock at the stance taken by Turkey's military, which threatened to intervene in the selection of the new president - which is by parliamentary vote rather than direct election - and urged the government to curb Islamic influences. `This statement looks like a deliberate attempt by the armed forces to influence the election of a new president,'' Terry Davis, secretary-general of the Council of Europe, said in a statement. `They should stay in their barracks and keep out of politics.''

Now the criminal:The United States stayed away from criticizing any of the players in the crisis. `We have confidence in Turkey's democratic institutions and Turkey's constitutional processes to work out any questions that may surround the election of the next Turkish president,'' State Department spokesman Sean McCormack told reporters.

One of the residents of the central Anatolian province of Kayseri, known in Turkey for their practicality, has realized a first and set up a unique store for prayer beads, in use among Muslims for centuries. Fans of beads come from all over Turkey to Tesbih Dünyası (prayer bead world) to see the valuable beads there, many of them even ready to pay as much as $5,000 for a set. The man behind the project is Kenan Paydak, who described their store as being “like a market” where sellers and purchasers can meet. Stating that those who come to the store have a chance to display their beads while being provided with food and drink, Paydak says they are very busy on weekdays. “People from all over Turkey come here, especially on Monday. Some come to sell their beads, others to add new beads to their collection. Sales are made here all day long. We act as an agent between them,” Paydak said.